NEW YORK – From humble origins as a natural gas distributor, Enron became a trading operation with the Midas touch. It made bets on oil, water, Internet traffic, even the weather. Wall Street’s brightest worked there. Its stock tripled in two years.

Virtually no one knew how it had made so much money.

Ten years ago Friday came the answer: It hadn’t.

Enron’s bankruptcy on Dec. 2, 2001, revealed a fraudulent illusion. Investors swore they would not be so profoundly deceived again. But it was only the beginning of a decade when so much in the economy was not as it seemed.

Can’t-lose Wall Street guys turned out to be cheats. Home values did not go up forever. Promising signs of recovery after the Great Recession turned out to be nothing, and hard times endure.

The theme was shredded faith – that and debt, the more the better.

“We have faith in the big score,” financial historian Charles Geisst says, trying to explain why Americans have, time and again, believed in what was too good to be true.

In the simple story of the past decade, a journey from corporate scandals to a housing bubble, then to a collapse and a frustratingly slow recovery, the villain is Wall Street and the victim Main Street. The reality is more complicated.

One reason people didn’t know how Enron made money was that it was an amalgam of 3,000 private deals that came to light in its collapse, partnerships with names like Raptor, Condor and Chewbacca.

Behind those obscure names, Enron shunted billions of dollars of debt off its books. Investors were safe as long as they didn’t ask too many questions. The company borrowed from Wall Street banks, mutual funds and insurers, pledging its hot stock as collateral.

The collapse wiped out $11 billion in stock value, nearly 10 percent in the 401(k) retirement accounts of Enron employees.

A month later, an outspoken, Harley-riding CEO with an uncanny ability to pull profits out of a seemingly dull New Hampshire manufacturer appeared on BusinessWeek’s list of top corporate managers. His name was Dennis Kozlowski. By the end of 2002, he was indicted for stealing $150 million from shareholders, and his company, Tyco International, was bankrupt.

Several other heroes of capitalism toppled after him. Bernard Ebbers drove WorldCom into bankruptcy after misleading investors in his high-flying company in an $11 billion accounting fraud. John Rigas, who turned a $300 purchase into a cable TV empire, was convicted of fraud after prosecutors said he ran Adelphia Communications like a “personal piggy bank,” including using $26 million of company money to buy timberland next to his home to preserve his view.

Martha Stewart, who built her cooking and decorating business on an image of homespun goodness, faced a grilling from regulators that suggested a life more tawdry than tidy: She had dumped shares of a drug company on what appeared to be an illegal tip from her Merrill Lynch broker. She was convicted of lying, though never accused of insider trading. The amount the one-time billionaire saved by selling early was $51,000.

It was a time of plummeting stocks, trashed retirement accounts, lost jobs and lost trust. One headline from 2002: “Scandals Shred Investors’ Faith.”

Regulators cracked down, offering hope. Congress created a board to police the accounting industry. It also passed the Sarbanes-Oxley Act, requiring executives to sign off on financial statements so they could be criminally liable for posting phony numbers.

Investors were thought more vigilant, too. But they got sloppy again, and almost immediately.

Around the time of Enron’s collapse, press reports detailed how Italy, years earlier, had struck complicated “currency swap” deals with banks so it could borrow money without having to recognize the debt on its books.

Later, Greece was shown to have camouflaged its debt in a similar way.

In 2002, no one seemed to care. By the end of the year, Italy was paying about 4 percent a year in interest on its national bonds, roughly what the U.S. was offering and a sign that few investors were worried.

In 2003, as jurors heard how Kozlowski got Tyco to pitch in $1 million for his wife’s birthday party, featuring an ice sculpture of Michelangelo’s David that urinated vodka, the seeds of a new crisis were being planted.

American consumers had run up debt to record levels by the end of 2003, and more of them than ever were filing for bankruptcy. Yet the stocks of companies extending mortgages to the riskiest borrowers, so-called subprimes, were rising fast.

Subprime was a euphemism for people who had too little income, too much debt, a bad record of paying lenders back – or all three. As home prices rose, worry that they would not meet their mortgage payments was replaced with faith that, even if they couldn’t, they could always sell the home for more than they borrowed and return the money.

Lenders eventually grew so cocky that they seemed willing to give money to virtually anyone who wanted a home.

They also offered mortgages on top of mortgages – so-called home equity loans that allowed people to tap their magically rising values to raise cash for flat-screen TVs or Caribbean vacations. Or to pay their credit card bills.

“If your home keeps appreciating, why not use the equity,” Robert Cole, CEO of mortgage lender New Century, said at the time.

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